The city of Ketchum is flashing a "come hither" look to hotel developers. The ordinances they enact in the coming weeks could make the city the life of the party—or leave its dance card empty.
The mayor and City Council are in the last throes of adopting new regulatory amendments before Election Day. On Nov. 7, voters will decide the fate of Proposition 2, a "takings" initiative that would require municipalities to compensate property owners if zoning changes affect their land values.
That deadline sped up an evaluation already in the works on how to attract financially viable hotels while keeping them in conformance with Ketchum's small-town feel.
In other words, the city is trying to say it is "open for business" while still maintaining some controls on hotel height, ownership components and location.
"If we just say we're open for business anywhere, we haven't provided any leadership," Councilman Steve Shafran said during a meeting Tuesday, Oct. 24.
Finding that sweet spot for hotels has been a priority for the past year, as the city works on the implementation of a downtown master plan to enliven the core.
"We've said it time and again," Shafran said. "Getting hotels built is a really high priority for us."
The council debated the definition of a hotel in order to offer developers basics around which to design.
"What we want to do is give the development community certainty," Shafran said. But, "I'm looking for as much regulatory flexibility as we can have without being accused of spot zoning."
The city is increasingly comfortable with the notion of residential units in hotels—which are owned by individuals and are not rented out on a nightly basis year around. Hotel developers have pleaded with the city for years to get them to allow that component because, they say, it's the only way to make such projects economically feasible.
"If we're going to 'incentivize' hotels, I'm not the least bit scared of having some market-rate," Councilman Ron Parsons said. "One way to help ensure it doesn't go belly up is to offer some (of that)."
Council members will at some point have to decide how many ownership units would be allowed.
Hotel developers in attendance Tuesday said some projects are as much as 50-50.
Other resort communities aren't going to such lengths to define hotels. Many have on their books only a simple definition of hotels, said contract planner Lisa Horowitz.
"They don't seem to be approaching it from a level of complexity we are," she said.
The residential component of hotels could be subject to inclusionary zoning requirements. Inclusionary zoning, currently under consideration by the council, is a way to get private development to build some affordable-housing units.
Hotel recommendations from economic development consultant Tom Hudson included allowing three-story hotels anywhere in the city center, and allowing four-story hotels in "receiving areas."
Receiving areas are spots designated on a city map for a transfer of development rights system. That system allows owners of smaller, heritage-type buildings to sell off their development rights, in the form of floors, to property owners in receiving areas. The idea is to keep some areas of town with a small-town feel while rerouting growth to more appropriate areas.
While the city is still considering adopting the TDR system, council members are looking to the proposed sending and receiving area map for hotel location.
The Ketchum Planning and Zoning Commission was "somewhat supportive" of five-story buildings for certain other uses, said Harold Moniz, Ketchum planning director. Besides hotels, the P&Z would consider that height for affordable housing buildings and educational facilities. That reflects public sentiment as measured at workshops and hearings during the development of the downtown master plan.
The P&Z earlier this month, however, rejected greater density for other development in the downtown core by sticking by a floor-area ratio system, which governs a building's volume in relation to the lot.
City staff is recommending a maximum of four-stories be allowed for hotels in the commercial core.
Council members were leaning this week toward allowing four-story hotels in receiving areas, which could see stories above the maximum of three anyway if the TDR system is implemented.
Five-story hotels are being considered for a few select areas of the core.
The council is also looking to address potential problems once a hotel is built.
Councilman Baird Gourlay posed a scenario wherein a hotel received density bonuses but failed after opening and wanted to turn "hot" beds into ownership units.
"We've given the density to (them) and we have no recourse," he said. "In case of failure of a hotel, we are giving an awful lot."
He proposed holding back a portion of the rooms, such as 20 percent, from the ownership market. If the hotel fails, those rooms could revert to affordable-housing units.
Hearings on zoning districts, text amendments and regulations were scheduled to for Thursday night, and will continue at 5 p.m. Friday, Oct. 27, and Monday, Oct. 30, at City Hall. Call 726-3841 for specific agenda information.
